Allegations of Inventory “Pump and Dump”
The lawsuit claimed that when the COVID-19 boat-buying boom began to fade in 2022, Malibu Boats executives sought to prop up profits by forcing a key dealer to buy more than $100 million worth of unwanted, high-margin boats.
Investors alleged the company misled shareholders by assuring them its wealthy customer base was “not really affected” by interest rates or economic pressures. In reality, demand slumped as borrowing costs rose, leaving dealers swamped with excess inventory.
According to filings, Malibu’s pandemic-era surge was dramatic — with 42% sales growth in fiscal 2021 and another 30% increase in fiscal 2022. But by mid-2022, those gains reversed, triggering claims the company engaged in aggressive channel stuffing to mask the slowdown.
Legal Teams Weigh In
The Baltimore pension fund is represented by Lester R. Hooker, Steven B. Singer, Joshua H. Saltzman, and Sara DiLeo of Saxena White PA.
The defense team includes Sarah M. Lightdale, Aric H. Wu, Reed A. Smith, Anne E. Bigler, and Brett De Jarnette of Cooley LLP.
Neither side immediately responded to requests for comment Friday.
If approved, the deal will end two years of litigation accusing Malibu Boats of misrepresentation and inventory manipulation to reassure Wall Street as sales momentum faded.
